Pakistan Sugar Industry

IMPORTANCE:

It is the 2^nd largest industry after textile. Pakistan is the 5^th largest country in terms of area under cultivation. Its contribution to the GDP is 1.9 %. The industry is the main source of employment generation for the rural areas (nearly 12-13 % of agricultural labor force). It’s a good source of foreign exchange. These industries are in the rural areas of the country which is why it’s good for the development process in the rural areas.

 

HISTORY AND OVERVIEW:

In 1947, Pakistan had only 2 sugar mills, Rahbali in Sindh and Takhbai in Punjab with the capacities of 600 TCD and 1200 TCD respectively. To meet its requirement the country started importing sugar. In 1957, the govt. setup a commission to frame a scheme for the development of the Industry. In this way the first mill was established at Tando Muhammad Khan in 1961. Between 70’s and 80’s 15 new mills were established.

 

From 1991 to 2000 the output increased at an average of 24%, production by 11.7% and cultivated area by 10.7 %. There were 71 functioning mill in 1998-99, which reduced to 67 due to the financial crisis in 1999-2000.

 

Currently we have between 70-80 sugar mills and around 74 are operational. In Punjab 80 % of the sugar cane is taken by the mills, 87% in Sindh and 30% in NWFP. The sugar cane of Sindh is better than the sugar cane grown in Punjab because of the better climatic conditions.

 

The area under cultivation has increased by 100% due to the government support policies, institutional loaning and support prices.

 

The average output per hectare is 63 tones. Columbia produces around 133 tones per hectare, India 72 tones and Pakistan 47 tones.

 

64% of total cost of producing sugar is sugar cane. Mills are dependant in terms of their capacity utilization as to how much sugar cane they can hold on.

 

Sugar cane requires high temperature, plenty of sunlight, good drainage, high fertility of soil and lots of fertilizers. Either 1525 mm of rain or irrigation is required.

 

We recover around 11-12 % of sucrose and lose 20% because of mismanagement. To recover the maximum sucrose content, sugar cane should be in the mill within 6 hours of harvesting.

 

Minimum Sucrose content limit sent by the government is 8.7%. To increase the sucrose content millers have to pay extra amount.

 

Zoning system was introduced and millers could take sugar cane from certain lands. The yield per hectare had increased and the quality had improved. Farmers were also able to get timely loans. Though, the system was later abolished because farmers were being exploited.

 

MANUFACTURING PROCESS:

1)      First the sugar cane is washed

2)      Crushing takes place

3)      Filtration of  sugar cane juice

4)      Heating and evaporation of sugar cane juice by saturation

5)      Treating with limestone to remove further impurities

6)      Crystallization through centrifugal system

7)      Whitening Process- Supplanting process

8)      Sorting by size

9)      Storing sugar in go downs.

 

CRUSHING CAPACITY:

The crushing capacity had been increasing until 1998-99 when Pakistan had 71 mills, but then it decreased when the number of mills reduced to 67 due to financial crisis. This affected the overall output in 1999-2000.

 

DEMAND AND SUGAR PRODUCTION CAPACITY:

In 2001, the installed capacity for sugar production was estimated above 5.5 m tones, whereas the demand was estimated around 3 m tones. The large scale capacity was added in nineties and was the outcome of the entry of politicians in sugar industry, both in Sindh and Punjab.

 

BY PRODUCTS:

 

- Bagasse (25-30 %):

It is used in paper production or fiber boards, which are used for making light furniture.

 

- Molasses (3.5-4%):

Molasses are further crystallized into distilleries. It is also used for making ethanol.

 

- Press (10-15%):

It is used to make fertilizers.

 

PROBLEMS:

-         Liquidity is a problem

-         No Loans

-         Lack of interest

-         Millers don’t want to invest for environmental factors.

 

REASONS FOR LOW YIELD:

-         Unscientific/unsystematic agricultural practice

-         Conventional planting methods

-         Late planting

-         Early and late harvesting

-         Low soil fertility

-         No timely use of fertilizers

-         Crop variety is not in line with the area of cultivation.

-         Preparation of land is not proper

-         Pests, diseases and weeds

-         Credit Shortage

-         Poor Management of Crops

-         Recovery (low sucrose content)

 

 

RECOMMENDATIONS FOR SUGAR INDUSTRY:

 

- HIGH YIELDING VARIETIES FOR SUGAR CANE SHOULD BE INTRODUCED

- INITIAL WORKING CAPITAL SHOULD BE GIVEN TO THE MILLS

- GOVERNMENT SHOULD MAKE SURE THAT MILLS UTILIZE THEIR MAXIMUM CAPACITY

- WORKSHOP FOR FARMERS

- EXPORT OF SUGAR SURPLUS 

- INVESTMENT IN ETHANOL AS A FUEL

- IMPROVEMENT IN IRRIGATION SYSTEM